Hi,

I am new to this site and wondered and would be grateful if anybody could help?

I requested a copy of a credit card card agreement from HBOS via their customer service number and received a letter back advising that they can not locate it; however they advised that in order to comply with S78 the copy does not need to be a copy with the customers signature on it. They advise that they do not have to produce an actual copy of the document signed and the purpose of section 78 is to allow debtors access to their T&C's and by providing the debtor with a true copy of the T&C, they have complied with S78.

They go on to say that while they try to locate the full original agreement they will not be seeking to enforce the agreement however even if an agreement is unenforceable, the contract still has legal effect and is not void, the lender is merely prevented from seeking an enforcement order from the court.

This has been going on since August and they have added an additional £480 to the balance in fees and charges due to non pament. I have refused to pay (Reality is unable to) until they can provide a true copy. I am being bombarded with telephone calls and when I explain my query the robots just repeat themselves with 'as far as I am concerned, you have to pay'

What can I do? Is this correct?Any help or assistance would be greatly appreciated ...

Folically Challenged.

Hi

My understanding is that HBOS are correct. They only need to provide you with a copy of the agreement, but not the original part with your signature.

If your Credit Card agreement was entered into before April 2007, there is a chance it could be unenforceable. It is possible that HBOS might never find your original agreement to be able to produce to a court to take enforcement action. But the problem for you is that you have a long time to go before the 6 years statute barred limit kicks in. Before then, you could be taken to court if HBOS find your original agreement, the debt could be sold on to debt collection agencies and interest/fees will continue to be added. And then there is the harassment of phone calls, demand letter, defaults on your credit record, affect on credit rating etc.

If I were in your situation I think I would seek professional debt advice. It may be possible to enter into an affordable payment plan and HBOS may agree to freeze interest/fees being added. I would suggest you contact one of the following to find out more.

http://www.insolvencyhelpline.co.uk/

http://www.payplan.com/

http://www.cccs.co.uk/

http://www.nationaldebtline.co.uk/

http://www.citizensadvice.org.uk/

Hope this helps.

Huckster

Hi Huckster,

Thanks for taking the time to respond and for the valuable advice.

The account was opened prior to 2007. I am sure that this was sent unsolitited as a card arrived shortly after my 18th, 10 years ago. How can I check if it is unenforceable? If they can not provide me with acopy of the agreement, can they still sell this onto a third party and add charges? How can they prove that I agreed to the T&C's?

Thanks ...

While I can't offer much in the way of advice for moving forward, just remember that even if the debt is declared unenforcable it won't go away. It will reuin your credit rating, making obtian further credit (loans, cards, mortages) extremely difficult. In addition they are still able and will still continue to pressure you for payment - it just means that cna't go to court. There are still plenty of avenue's they can pursue - all undoubtedly increasing the stresses and inconveinces you are currently experiencing.

Personally arranging a repayment plan wtih them would be the better choice if I were in your shoes.

FC2

I agree with Mynewt, you can have a really miserable time corresponding with HBOS and the debt collection agencies that follow or you can opt to tackle the debt.

The options to tackle your debts are numerous and you can talk to the various companies that I provided links for in my previous post. Both the Insolvency Helpline and Payplan have freephone numbers and can advise on the options that would best suit you.

You could ignore this advice and decide that you want to get an admission of unenforceability from HBOS. There are various letters within the threads on the debt pages on this forum if you have a read. You may have read that it can be very frustrating as companies will not provide the original agreement under the CCA requests so you are left guessing as to whether they have your original form to go to court. HBOS will probably never admit the debt is unenforceable. You could then submit a subject access request under the Data Protection act. But again this may not achieve a result.

In the meantime, HBOS are fully entitled to register a default against your credit record, ask for debt companies to chase for the debt or even sell the debt on. You could be in for 6 or more years of hassle. Your credit record and rating will be totally sh*gged, meaning it will be almost impossible to obtain any form of credit. And the debt may rise due to interest/fees to a level where you cannot afford to repay.

As Mynewt advises, an unenforceable debt is not the same thing as a written off debt. Only the creditor and the courts can actually write a debt off. And it can be very difficult to take legal action to get these companies to write off debts due to issues with the terms and conditions of agreements being faulty/unfair. The banks have very deep pockets to pay for the best lawyers.

The sensible option of getting professional help is the way forward in my opinion.

Huckster

Whilst I also agree with huckster & Mynewt, a lot depends upon your attitude and determination to fight against the creditors.

It can take a lot of work and even more time. But I find it becomes a hobby, one that can have good financial returns. You need to learn all about the Consumer Credit Act and the relevant Regulations pertaining to it. You will find which clauses in the Act are important and the associated clauses in the associated Regulations.

Then you read around the threads in this forum and other forums learning as you go. But the most difficult I find is the court procedures and systems, which form for what. If you have any available cash you could go after the creditor, but only if you are sure you are right and can put together a legal argument.

Even if you pay for professional help (or even if you can get it for free) your credit record will be screwed!! Trust me, there is no way it won't be.

Finally you could send off a SAR to see if that will return an agreement.

IMO after 10 years it is HIGHLY unlikely there is a copy of a true enforceable agreement available if one ever existed in the first place.

huckster:

In the meantime, HBOS are fully entitled to register a default against your credit record, ask for debt companies to chase for the debt or even sell the debt on. You could be in for 6 or more years of hassle. Your credit record and rating will be totally sh*gged, meaning it will be almost impossible to obtain any form of credit. And the debt may rise due to interest/fees to a level where you cannot afford to repay.

Huckster

Hi Huckster,

Sorry Mate, I'm at it again.

The above statement is not true.

In order to register a default the creditor must be in legal possession of your personal details. In the absence of the executed agreement, they will not be able to evidence legal possession.

If a company shares your personal details without the legal right to possess then they commit an offence under the DPA.

You could seek injunctive relief from this.

That said, they will register defaults and mess up your credit rating and the regulators turn a blind eye, so they get away with it.

Oh for regulators with teeth.

S

Stubie

Amend are fully entitled to, they will do what they want.

This is an arguable issue. The credit card company could argue that they have been processing the card holders details for many years and have a finanicial relationship that cannot be disputed.I am not sure what legislation and cases they could use but I am sure they could offer up an argument.

I know what you are saying. That if they don't have the original signed form, they don't have the card holders consent to process data e.g. apply defaults.

I am not sure the courts would be helpful in this area of law. The House of Commons Treasury select committee had Experian, Equifax, British Bankers Association, Martin Lewis, Moneysupermarket rep etc in front of them last week, discussing all the various issues regarding credit records held by CRA's. I think there is movement to do something about the CRA's holding too much power and to legislate to protect consumers.

Cheers

Huckster

huckster:

Stubie

Amend are fully entitled to, they will do what they want.

I agree, they do take a "law optional" approach in these matters. As I said, the regulators don't want to get involved so this becomes "custom and practice".

huckster: This is an arguable issue. The credit card company could argue that they have been processing the card holders details for many years and have a finanicial relationship that cannot be disputed.I am not sure what legislation and cases they could use but I am sure they could offer up an argument.

I know what you are saying. That if they don't have the original signed form, they don't have the card holders consent to process data e.g. apply defaults.

This is being tested in the high courts at the moment, I will keep you posted. What I originally posted is strictly true from a legal perspective but there are mitigants which may be considered. The first hearing on "CRA reporting and default administration" was a no-show by the OC. They don't want this testing which implies that they feel the arguements are weak in prosecution of the case.

huckster:I am not sure the courts would be helpful in this area of law. The House of Commons Treasury select committee had Experian, Equifax, British Bankers Association, Martin Lewis, Moneysupermarket rep etc in front of them last week, discussing all the various issues regarding credit records held by CRA's. I think there is movement to do something about the CRA's holding too much power and to legislate to protect consumers.

Cheers

Huckster

Not before time, the sad reality is that if the CRAs are muted by legislation then a secondary reporting system will emerge, you can be sure of that.

P.S. I'm an argumentative old G*t and unfortunately unlikely to change.

I can only hope that these cases get some success for people such as FC2, but in the meantime surely we (by "we" I mean people that actually know what they're talking about so that pretty much counts me out) should be offereing the best advice to the OP, given what does go on (not necessarily what should) and what they can do to improve their situation in the meantime.

It seems to me (so I could be completley wrong) that some posters think getting the agreement declared unenforcable will make it go away, when it obviously doesn't. Some advice has re-enforced this false idea, and others as above has at least givne a fair perspective on the situation.

I just think we (there's that "we" again) should move from "should", "in theroy" and "in terms of law" to "What happens is..." and "what you can do is... with these consequences".

Stubie-One:[

Not before time, the sad reality is that if the CRAs are muted by legislation then a secondary reporting system will emerge, you can be sure of that.

P.S. I'm an argumentative old G*t and unfortunately unlikely to change.

It already has. I have three creditors whom I have 'pursuaded' to not register or remove defaults. Instead I now have 'no info available' recorded to those accounts, which I am convinced is creditor 'shorthand' to mean "do not touch!!".

It is no coincidence that another completely unchallenged credit account has been restricted (read no credit).

It is the modern equivalent of the 'old boy' network and cannot be challenged or dismantled.

huckster:

When the Department for Business Innovation and Skills (BIS) were guests on this board recently I made a suggestion or two which they promised to take away and consider, so if no future progress on the issue the failure started here.

http://www.moneysupermarket.com/community/forums/t/government-clampdown-on-credit-card-providers-39241.aspx

Jalexa

I have a feeling that not much will happen. The BIS and Treasury select committee might issue a lot of reports, with suggestions as to what should be done. But as a general election is only months away, all this work will be put on hold. Also I think the restructuring of the banking sector will be the prority during the next 2/3 years.

If you have a chance and are suffering from any insomnia, you can watch the select committee session online. The session is mostly about credit searches on credit records, but it will give you a flavour of the debate in this area. One of the Tory members of the committee Michael Fallon gave Martin Lewis a hard time, which suggested the Tories will be pro banks, rather than pro consumer. I am a floating voter, but it did make me think, Can a leopard change its spots?

This is the link to the debate. http://www.parliamentlive.tv/Main/Player.aspx?meetingId=4918

Huckster

Thanks to all those offering the advice.

I do want to repay this debt, however, I am unable to at the moment and do not like the bully tactics employed by HBOS. By way of background, I contacted them earlier this year (before requesting a copy of the agreement) to advise them that I was stuggling to make the repayments. Their own representatives advised me to miss a payment so that I would fall into 'arrears' and then they would be able to help. The only thing that this achieved was to increase my rate from 4.9% APR fixed, until paid in full, to 25.9%, significantly increasing the minimum repayment required. My offer of repayment was rejected as this did not meet the criteria required and now they are threatening to sell this off to a third party.

By HBOS not being in possession of a signed agreement, can I force them to accept a repayment offer for the capital of the balance only, request that they refund all the interest charges, against the capital, and stop them from selling this onto a debt recovery company? My credit file up until earlier this year did not show any missed payments etc, however my circumstances have since changed, resulting in it becoming completely kn*ck***d.

Any assistance or advice with this query would be very welcome.

FC

Folically Challenged2:

Thanks to all those offering the advice.

I do want to repay this debt, however, I am unable to at the moment and do not like the bully tactics employed by HBOS. By way of background, I contacted them earlier this year (before requesting a copy of the agreement) to advise them that I was stuggling to make the repayments. Their own representatives advised me to miss a payment so that I would fall into 'arrears' and then they would be able to help. The only thing that this achieved was to increase my rate from 4.9% APR fixed, until paid in full, to 25.9%, significantly increasing the minimum repayment required. My offer of repayment was rejected as this did not meet the criteria required and now they are threatening to sell this off to a third party.

By HBOS not being in possession of a signed agreement, can I force them to accept a repayment offer for the capital of the balance only, request that they refund all the interest charges, against the capital, and stop them from selling this onto a debt recovery company? My credit file up until earlier this year did not show any missed payments etc, however my circumstances have since changed, resulting in it becoming completely kn*ck***d.

Any assistance or advice with this query would be very welcome.

FC

The nitty gritty is this.

If HBOS don't have an agreement (which seems likely since they have already said as much) then they cannot enforce this debt in a court (i.e. obtain a CCJ). It is also true the debt is not 'written off', you still have a debt to HBOS you just don't have to pay it.

Fact is they and their DCAs will chase it, perhaps for years. It is also true that your credit record will be sha**ed for a long time = no credit!! Fact - end of. It would take a very skilled litigator to get them removed if it were possible and even then I doubt you would get good credit because I am convinced there is an 'underground' system of reporting bad debtors.

Even now if you enter into any repayment plan this will be recorded on your credit file which is also a red light to other possible lenders.

My advice (based on the likelyhood there is no agreement) is to stop payments, tell 'em to 'stick it', take the flak and wait for them to actually take you to court (which I very much doubt). I would still answer most of the letters explaining the situation (i.e. with no agreement there isn't anything they can do). It's a bit like having a pen friend who changes identity every so often and who doesn't know the true situation each time.

I actually look forward to the next letter. It isn't that expensive sending 2nd class letters every other week! Plus there is a sort of anticipation that one day a letter will be a court claim form! It has become a hobby and I'm getting quite interested in the law and how it works.